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Taxi app company Uber charged with licensing offences

City officials say a company offering a smartphone app to hail taxis and limousines in Toronto is operating illegally.

The city has charged Uber with 25 municipal licencing offences, including operation of an unlicensed taxi brokerage and unlicensed limo service, since they began operating in Toronto in late summer.

The company doesn’t have its own fleet. Uber gives the smartphone, as well as the dashboard cradle it sits in, free to cab drivers from other companies who sign up.

But the company needs a licence to dispatch, says Richard Mucha, acting manager of licensing enforcement for the city.

“If you plan on running a limousine service in the City of Toronto, or a taxi cab brokerage, then you require a licence,” says Mucha. “We met with Uber’s CEO Travis Kalanick in the spring of this year and we advised him in no uncertain terms that they were not operating in accordance with the City of Toronto’s licensing bylaw. So our position should come as no surprise to Uber.”

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Uber did not respond to requests for comment.

None of the charges have been dealt with in court.

Penalties range from $150 to $250 for each individual charge, but cumulatively, could go as high as $25,000. “The more convictions that are rendered, certainly the higher the fines,” says Mucha.

The Justice of the Peace who will hear the case could also stop the company from operating by issuing a prohibition order. If that doesn’t happen, the city could go to Superior Court to ask for an injunction.

Application fees for a taxi cab brokerage license are just under $370, but Mucha says Uber has never applied for one.

The company has encountered similar opposition in U.S. cities and is facing fines and lawsuits.

The company’s website says passengers are charged a 20 per cent gratuity above the metred fare. One Toronto cab driver said Uber takes a portion of that money.

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That, too, is a violation, Mucha says.

“If you’re charging anything other than the meter rate then that is contrary to the city’s licensing bylaw.”

The cab driver enters the metered fare into his phone and the application automatically adds the premium. The amount is charged to a passenger’s credit card, which they provide when they download the app.

An unlicensed driver using the app has already been charged and convicted, says Mucha. As of Wednesday, Uber was still operating in Toronto.

The taxi industry has experienced a bit of a shakeup with the onset of the applications.

Hailo, which has an office at Queen St. near Sherbourne St., offers a similar app, but the company has escaped regulatory censure in Toronto because it is a licensed taxi brokerage and works with licensed drivers.

And it charges the driver to use the service, not the passenger.

Since Hailo launched in September, 30,000 passengers have downloaded the app, says company president Justin Raymond. And 600 cabbies are using the driver app.

But Hailo has experienced resistance from established operators such as Beck. Some cab drivers for the company say they’ve been pressured not to use the app. The city is currently investigating complaints against the cab brokerage, although Mucha wouldn’t specify what they were.

Toronto is reviewing its licensing bylaws with regards to taxi cabs and the apps will figure in the debate.

“Certainly we’re not against technology,” says Mucha. But “there would be some opposition to having anything charged beyond the metered rate from an issue of transparency.”

Uber and the city will be in court Jan. 30 when a trial date will be set.

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